Category: Financial Times Summaries

18 July 2019

 

Question: According to MSN: Money, what is the most educated county in Maryland?

 

G7 nations struggle to reach digital tax compromise – Pg. 2

• Finance minsters of the biggest western economies were struggling to reach a compromise last night on how to tax tech companies such as Google and Facebook that often pay little corporate tax in countries where they profit from consumers and their data
• …other issues, including a related plan to work out a minimum coporate tax regime across the world so that multinationals cannot divert their profits to tax havens or low-tax jurisdictions, there was more consensus among the ministers and central bank chiefs
• France and other countries have been keep to set a suggested minimum company tax rate, or a range of possible rates, to accelerate the process at the OECD
• The US has accepted the idea of a minimum rate for all companies

 

Eurozone: Young people struggle in two-tier labour market – Pg. 3

• …block’s young people still face high unemployment rates, precarious work, underemployment and inactivity, …
• The proportion of workers aged between 15 and 24 who are unemployed is about 16%, double that of the general population
• Young workers in the Eurozone were the first to lose their jobs during the economic crisis

 

US banks feel heat as Fed rate cuts loom – Pg. 12

• For US banks, the future arrived this week. Investors have long fretted about falling interest rates hitting growth at even the best-managed lenders.
• Falling rates are not all bad news. They eventually result in lower funding costs as the overnight federal funds rate comes down,…
• The strongest performer in the unit was the credit card business, where revenues rose 18%
• Bullish investors also take heart from the fact that US bank stock prices are already at historic lows, on measures like price relative to book value

 

Answer: Howard County (31.1% Graduate or Professional degree)

17 July 2019

 

Question: According to MSN: Money, what % of student loan borrowers owe more on student loans than their annual salary?

 

China recruits consumers to help win US trade war – Pg. 3

• In the US, importers that rely on cheap Chinese materials and goods have faced price rises of up to 25% on everything from aeroplane parts to frozen Pollack
• …Chinese manufacturers have suffered a fall in export orders, which declined 1.3% in June compared with the same month a year earlier, a clear sign tariffs have started to bite
• China….reported robust domestic consumption in June, with retail sales up 9.8%…
• Total social finance, a broad measure of credit growth in China, picked up in June, a sign that leaders in Beijing will resort to more debt-fuelled growth through to the end of 2019

 

OECD calls for Europe to spend to boost growth – Pg. 3

• Slower Chinese growth and “the amount of debt that is piling up in the economy” risked giving rise to financial instability…”

 

French central bank urges ECB to resist pressures on rates – Pg. 3

• France’s central bank chief has said monetary policy must remain independent of market inflation expectations as well as political pressure, and pushed back at suggestions the ECB should cut rates at its July meeting
• Markets’ falling inflation expectations are fueling pressure on the ECB to launch more monetary stimulus. The so-called five-year/five-year inflation swap rate, a measure of expectations of future Eurozone inflation, has fallen to around 1.2%, the lowest level since records began in 2003 and well below the central bank’s target of 2%

 

Global economy – Pg. 7

• The dead-of-night sacking last week by legally-dubious presidential decree of Murat Cetinkaya, governor of Turkey’s central bank, was followed by the shock resignation of Carlos Urzua, Mexico’s finance minister, who slammed the door on his way out with complaints of cack-handed meddling by unqualified apparatchiks
• The Turkish Lira and Mexican peso fell more than 2% against the US dollar and analysts warned of disarray ahead,…
• Starting in the 1990s, globalization, in the form of increased cross-border trade, the commodities supercycle and the rise of global supply chains, drove the emerging world inexorably – or so it seemed – along a part of convergence with the developed world
• The threat of globalization is one of three big changes simultaneously hitting emerging markets. The second is a slowdown in the rate of growth in China.  The third is a change in global financial conditions after a decade of easy money
• But companies are not simply reallocating resources around the developed world. Foreign direct investment into emerging markets as a whole fell last year to its lowest level since the 1990s, …
• When it was driven by investment in infrastructure, China’s hunger for iron ore, copper and other inputs was a godsend for commodities exporters – from Brazil and Chile to Nigeria and the Democratic Republic of Congo. But Chinese investment has fallen, from the equivalent of 48% of GDP in 2011 to less than 45% since 2015.  Meanwhile, investment is moving towards services and other less commodity-intense activities

 

Answer: 1/6

15 July 2019

 

Question: According to MSN: Money, what is the range of FICO scores and what is the U.S. national average?

 

Saudi women to gain travel freedoms in big victory for female rights – Pg. 1

• Saudi Arabia plans to grant women the right to travel without a male guardian’s permission as the government moves to relax social restrictions in the kingdom’s male-dominated society
• Women at any age and men under 21 currently need a guardian’s permission for international travel
• Female unemployment in Saudi Arabia stands at 32.5%

 

IMF chief backs stimulus eyed by top central banks – Pg. 3

• …thinly veiled nod to the US Federal Reserve and the ECB as they consider easing
• The IMF in April downgraded its forecast for global growth this year to 3.3% but predicted a rebound to 3.6% by 2020
• Mr Lipton, a former Clinton and Obama administration official who has been the first deputy managing director of the IMF since 2011, took the helm this month after Christine Lagarde was nominated to lead the ECB at the end of Mr Draghi’s term later this year
• The acting IMF chief said he was encouraged that the US and China had resumed their “dialogue” over trade,…

 

Tech woes put US on course for earnings recession – Pg. 6

• Equity investors are bracing for a second successive drop in US quarterly profits, led by technology and materials sectors, which could undermine a record run in the stock market
• Blue-chip companies across the US are expected to reveal a 2.8% drop in earnings per share for April to June,…
• Despite the first-quarter earnings contraction, US shares have continued to soar
• Labour costs amount to about 16% of revenues for the information technology companies, the second highest level after the industrials sector,…
• The impact of share buybacks will also soften the impact of lower earnings on a per share basis

 

Unsold property glut threatens India economy – Pg. 7

• Shadow banks grew to account for a fifth of new credit last year, and became the largest source of funding for real estate thanks to loan growth of more than 20% a year between 2013 and 2018
• …developers collectively owe $37bn to the non-bank financial sector
• …half of the luxury real estate in central Mumbai alone is unsold: 11,000 properties…
• In Mumbai, the glut of expensive housing has only increased. Unsold inventory in the city rose 14% in the first half of 2019…

 

Education start-up tipped to gain unicorn status – Pg. 8

• …aims to shake up executive education by delivering courses across the world in partnership with leading business schools
• …estimates that the online professional education market is worth $280bn globally, of which 15% is for high-level executive education

 

Insurance – Pg. 15

• …start-ups are betting that the global life insurance market, which ….generated $2.8tn of premiums last year, will eventually migrate online just as car and home insurance has done in places such as the UK
• The start-ups are betting that all that will change once today’s young adults, who have grown up buying everything online, reach an age when they start thinking about life insurance. That often coincides with buying a property or becoming a parent
• Without an agent to explain exactly what life insurance involves, the start-ups have had to do things a little differently, focusing on making their products as simple as possible
• Another hurdle for the start-ups to address is that insurance companies need people to go out and convince customers that they need cover

 

Answer: 350 – 850 and 704 is the US national average